Toxicology testing company Cyprotex's revealed its first loss since 2007 at the half-year stage after the company was hit by a contract delay at a large US customer. However, with a better performance in Europe, the group's traditional second-half sales weighting should help management hit full-year forecasts - leaving the shares still looking attractive.
A reduction in pharmaceutical research budgets meant the company has needed to broaden its offering to include tobacco, food producers and agro-chemical companies. That diversification drive explains the impressive 30 per cent rise in European sales to £1.06m, with a corresponding 12 per cent rise in UK revenues to £0.86m. The US proved more problematic, however, after contract delays hit performance and sales there fell to £1.68m from £1.91m last year. Still, chief executive Anthony Baxter emphasised that Cyprotex traditionally experiences an uplift in profits and sales in the second half. Based on the confirmed order book, and on trading so far in August, he reckons the full-year outlook remains unchanged.
Broker Singer Capital markets left its full-year forecasts unchanged and expects pre-tax profit of £0.6m, giving EPS of 0.3p (2011:£0.6m/0.4p).
CYPROTEX (CRX) | ||||
|---|---|---|---|---|
| ORD PRICE: | 4.5p | MARKET VALUE: | £10.1m | |
| TOUCH: | 4.3p-4.8p | 12-MONTH HIGH: | 6.8p | LOW: 2.8p |
| DIVIDEND YIELD: | nil | PE RATIO: | 16 | |
| NET ASSET VALUE: | 3p* | NET DEBT: | 12% | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£000) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 3.54 | 0.66 | nil | nil |
| 2012 | 3.72 | -228 | -0.10 | nil |
| % change | +5 | - | - | - |
Ex-div:- Payment:- *Includes intangible assets of £3.51m, or 1.6p a share | ||||
